Berkshire's Charlie Munger calls bitcoin 'noxious poison'
- The bitcoin technology might be interesting but the investing frenzy around it over the last year should have prompted a government crackdown like the one in China, Charlie Munger says.
- Munger also says it's time for regulators to "let up" on Wells Fargo, which has struggled to overcome criticism of several product sales scandals and its attempts to repay customers.
Charlie Munger has no patience for bitcoin.
During a two-hour question-and-answer session Wednesday at the Daily Journal shareholder meeting, the vice chairman of Berkshire Hathaway and longtime sidekick to Warren Buffett said he considers the current bitcoin craze to be "totally asinine."
"Bitcoin is noxious poison," Munger said in response to a question. Munger, 93, is chairman and a director at Daily Journal, a Los Angeles-area publishing company, and his appearance at its annual meeting is a chance to hear his views on a wide range of subjects.
On bitcoin, the technology might be interesting but the investing frenzy around it over the last year should have prompted a government crackdown like the one in China, he said. "Our government's more lax approach to it is wrong. The right answer to something like that is to step on it hard."
Munger also tried to pre-empt questions about Berkshire's biggest stock holding, Wells Fargo. The bank has been struggling with intense regulatory and media scrutiny since 2016, when a massive fake account scandal came to light. Since then, Wells has admitted it also sold car insurance to customers who didn't need it and improperly charged fees on some mortgage rate lock extensions.
Berkshire owns $27 billion of Wells shares, about 9 percent. On Wednesday Munger said it was time for regulators to "let up" on it.
The bank had employee sales incentive systems that were too strong in the wrong direction and it was too slow in reacting, he said. But it is working to fix the problems. "I think Wells Fargo will be better off for having made those mistakes."
Munger said a fledgling effort by Berkshire to work with J.P. Morgan Chase and Amazon on a new healthcare solution for their thousands of employees will take a while to sort out. "The existing system is not only regrettable, it's evil," he said, citing soaring costs and misaligned incentives. "That's a very difficult thing to take on. I don't know how it will work out."
On the current economic climate and the government's plans to increase the deficit, Munger said, "Of course I'm concerned about the rising level of government debt. On the other hand, it's possible the world will function well even with a different pattern of government behavior."
He added, "Don't expect the world to go totally to hell."